Foreign Trade Regulations (FTR): State Department Directorate of Defense Trade Controls Filing Requirement and Clarifications to Current Requirements
| Published date | 10 August 2023 |
| Record Number | 2023-16970 |
| Court | Census Bureau |
| Section | Rules and Regulations |
Federal Register, Volume 88 Issue 153 (Thursday, August 10, 2023)
[Federal Register Volume 88, Number 153 (Thursday, August 10, 2023)]
[Rules and Regulations]
[Pages 54234-54237]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2023-16970]
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DEPARTMENT OF COMMERCE
Census Bureau
15 CFR Part 30
[Docket No. 230802-0181]
RIN 0607-AA61
Foreign Trade Regulations (FTR): State Department Directorate of
Defense Trade Controls Filing Requirement and Clarifications to Current
Requirements
AGENCY: Census Bureau, Commerce Department.
ACTION: Final rule.
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SUMMARY: The Census Bureau issues this final rule amending its
regulations to reflect new export reporting requirements related to the
State Department, Directorate of Defense Trade Controls (DDTC) Category
XXI Determination Number. Specifically, the Census Bureau is adding a
conditional data element, DDTC Category XXI Determination Number, when
``21'' is selected in the DDTC USML Category Code field in the
Automated Export System (AES) to represent United States Munitions List
(USML) Category XXI. In addition, this rule makes remedial changes to
the Foreign Trade Regulations (FTR) to update International Traffic in
Arms Regulations (ITAR) references in existing data elements: DDTC
Significant Military Equipment Indicator and DDTC Eligible Party
Certification Indicator. This rule also makes other remedial changes to
the FTR.
DATES: This final rule is effective November 8, 2023.
FOR FURTHER INFORMATION CONTACT: Omari S. Wooden, Assistant Division
Chief, Data User and Respondent Outreach, Economic Management Division,
Census Bureau by phone (301) 763-3829 or by email
[email protected].
SUPPLEMENTARY INFORMATION:
Background
The Census Bureau is amending the Foreign Trade Regulations (FTR)
to add a conditional data element, Directorate of Defense Trade
Controls (DDTC) Category XXI Determination Number, when ``21'' (see
Appendix L of the Automated Export System Trade Interface Requirements
(AESTIR)) is selected in the DDTC United States Munitions List (USML)
Category Code field in the Electronic Export Information (EEI). The FTR
defines the DDTC USML Category Code as the USML category of the article
being exported (22 CFR) part 121).
Public Law 106-113 amended 13 U.S.C. 301, to add subsection ``(h)''
directing the Secretary of Commerce to require, by regulation, the
mandatory electronic filing of export information through the Automated
Export System (AES) for items identified in the Commerce Control List
(CCL) and the USML. Under the authorities in chapter 9 of title 13,
U.S.C., the Secretary of Commerce will collect additional data on the
export of items under DDTC USML Category Code ``21'' to identify and
validate commodities for which DDTC USML Category Code ``21'' is cited.
The DDTC Category XXI Determination Number is a unique number
issued by DDTC in conjunction with a notification that a specific
commodity is described in USML Category XXI. Information on valid USML
Category XXI determinations and the prospective AES error code may be
found in the Frequently Asked Questions section of DDTC's website
(www.pmddtc.state.gov).
The Census Bureau published a Notice of Proposed Rulemaking (NPRM)
in the Federal Register on May 3, 2023 (88 FR 27815) to add the
conditional data element, DDTC Category XXI Determination Number, when
``21'' is selected in the DDTC USML Category Code field in the
Automated Export System (AES) as well as to make the remedial changes
originally proposed in the NPRM published December 15, 2021 in the
Federal Register (86 FR 71187). Comments to these remedial changes were
favorable.
Finally, the U.S. Department of Homeland Security and the U.S.
Department of State concur with the revisions to the FTR as required by
13 U.S.C. 302 and Public Law 107-228, division B, title XIV, section
1404.
Response to Comments
The Census Bureau received three comments on the NPRMs published in
the Federal Register on December 15, 2021 (86 FR 71187) and May 3, 2023
(88 FR 27815). A summary of the comments and the Census Bureau's
response are provided below.
Comment. The commenter stated that it is unclear if the Census
Bureau proposed to update the published penalty amount in Sec. 30.71
as it still states $10,000 and has not been $10,000 for years. The
commentor suggested to update the correct current amount, in
conjunction with the footnote update proposed.
Response. The Census Bureau has reviewed this comment and disagrees
that the amount shown in Sec. 30.71 should reflect the current amount
with the footnote to address the adjustment for inflation. The $10,000
referenced in Sec. 30.71 is consistent with 13 U.S.C. 305. The current
penalty amounts are published in 15 CFR 6.3(d).
Comment. The commenter recommends that the Census Bureau eliminate
the Dun and Bradstreet Number (DUNS) for reporting the U.S. Principal
Party in Interest Identification Number (USPPI ID) because reporting
the DUNS requires the company to also report their Employer
Identification Number (EIN) and adds to reporting burden and filing
mistakes thus increasing risks of incurring a fine and/or penalty. The
commenter also recommended that the Census Bureau review and publish
the percentage of shipments where the DUNS is used as the filer ID. The
commenter also stated that if the Census Bureau decides to keep the
DUNS as a USPPI ID, then Sec. 30.3(e)(1)(ii) needs to reflect that
when the USPPI uses the DUNS as their filer ID, they must also provide
the FPPI's authorized agent their EIN. As currently proposed in the
NPRM, the USPPI either provides the EIN or DUNS.
Response. The Census Bureau has reviewed this comment and disagrees
with removing the DUNS as an option for reporting the USPPI ID. USPPIs
who have postdeparture filing privileges support the use of the DUNS as
the USPPI ID because USPPIs prefer to have the less sensitive DUNS
rather than the EIN shown on the front page of bills of
[[Page 54235]]
lading/air waybills and other commercial documents as part of the
postdeparture filing citation. However, as a result of this comment,
FTR Appendix B to Part 30--AES Filing Citation, Exemption and Exclusion
Legends (II and III) will be changed from USPPI EIN to USPPI
Identification Number to allow either the EIN or DUNS. In regard to the
comment of the USPPI using the DUNS as the filer ID, the Census Bureau
agrees and has changed Sec. 30.3(e)(1)(ii) to reflect the requirement
to provide the USPPI Identification Number as defined under Sec.
30.6(a)(1)(iii).
Comment. The commenter expressed appreciation for the clarification
of Sec. 30.6(a)(1)(iii); specifically, clarifying that, when the DUNS
is reported as the USPPI ID type, the EIN is also required. The
commenter stated that the use of the DUNS and EIN as the USPPI ID has
been a mystery to most EEI filers and many EEI transmission software
systems are not programmed to accommodate this requirement. According
to the commenter, the users of many transmission software systems
select USPPI ID type as either DUNS or EIN and then enter a number.
Selecting the DUNS option alone fails. As a result, users typically
select the ``EIN'' option and then enter a DUNS number. Alternatively,
filers will obtain an EIN and only report that number. Therefore, the
commenter stated that the practice is that many, if not most, filers do
not report both the DUNS and EIN. The commenter believes that it is
unlikely, even with this clarification, that EEI filers will begin to
transmit both DUNS and EIN or that software providers will change their
systems. The commenter stated that it would be helpful if Census could
provide further information on the reason and value of receiving the
DUNS number.
Response. The Census Bureau historically has given USPPIs the
option of providing the DUNS or EIN as the USPPI ID. The option of
reporting the less sensitive DUNS instead of the EIN became more
favorable to USPPIs who were approved for the postdeparture filing
program because the postdeparture filing exemption contains the USPPI
ID which is visible on the front of commercial documents. However, when
the DUNS is reported as the USPPI ID in the AES, the Census Bureau also
requires an EIN. The Census Bureau must have the EIN to link to the
Business Register to collect information for the Profile of U.S.
Exporting Companies statistical release.
Changes to the Proposed Rule Made by This Final Rule
As discussed above, after consideration of the comments received on
the proposed rule, the Census Bureau includes in this final rule an
additional change to Sec. 30.3(e)(1)(ii) to reference the USPPI
Identification Number instead of USPPI EIN or DUNS. This change will
provide consistency with Sec. 30.6(a)(1)(iii), which states that, if
the USPPI Identification Number is reported as a DUNS, the submission
of the EIN of the USPPI also is required. Additionally, FTR Appendix B
to Part 30--AES Filing Citation, Exemption and Exclusion Legends (II
and III) will be changed from USPPI EIN to USPPI Identification Number
to allow further consistency with Sec. 30.6(a)(1)(iii).
Program Requirements
Pursuant to the Foreign Relations Act, Public Law 107-228 and 13
U.S.C. 302, the Census Bureau is amending relevant sections of the FTR
to revise or clarify export reporting requirements. Therefore, the
Census Bureau is amending 15 CFR part 30 by making the following
revisions:
Revise Sec. 30.2(d)(3) to remove the language, ``(See
subpart B of this part for export control requirements for these types
of transactions.),'' as the exclusion overrides the export control
requirements.
Revise Sec. 30.3(e)(1)(ii) to remove USPPI EIN or DUNS
and replace with USPPI Identification Number.
Revise Sec. 30.6(a)(1)(iii) to clarify that, when the Dun
and Bradstreet Number (DUNS) is reported as the U.S. Principal Party in
Interest (USPPI) Identification Number, the Employer Identification
Number (EIN) of the USPPI also is required to be reported in the
Automated Export System.
Revise Sec. 30.6(b)(3) to amend the Foreign Trade Zone
(FTZ) identifier to allow for nine digits. The increased number of
digits is required because of the increase in the number of subzones.
Revise Sec. 30.6(b)(16)(ii) to amend the DDTC Significant
Military Equipment (SME) indicator by updating the ITAR references as a
result of DDTC relocating certain ITAR provisions to improve the
overall structure of the ITAR.
Revise Sec. 30.6(b)(16)(iii) to amend the DDTC eligible
party certification indicator by updating the ITAR references as a
result of DDTC relocating certain ITAR provisions to improve the
overall structure of the ITAR.
Revise Sec. 30.6(b)(16)(ix) to add the conditional data
element ``DDTC Category XXI Determination Number.'' The ``DDTC Category
XXI Determination Number'' will be the unique number issued by DDTC to
a member of the regulated community (usually the original equipment
manufacturer) in conjunction with a notification that a specific
commodity is described in USML Category XXI. This number is required
only when citing Category XXI as an export classification and is used
to confirm that an authoritative DDTC USML Category XXI determination
is being referenced to do so.
Revise Sec. 30.37(u) to remove and reserve the exemption
for technical data. This exemption is covered under Sec. 30.2(d)(3),
making the exemption redundant.
Revise Sec. 30.55 to remove the citation ``19 CFR 103.5''
and add in its place ``19 CFR part 103.''
Revise Sec. 30.71 to amend the Note to paragraph (b) to
address the yearly adjustments for civil penalties as a result of
inflation.
Revise Sec. 30.74 to amend paragraph (c)(5) to remove
information that may become outdated and referencing the Census Bureau
website to obtain the most current method for submitting a Voluntary
Self-Disclosure.
Revise FTR Appendix B to Part 30--AES Filing Citation,
Exemption and Exclusion Legends (II and III) to remove USPPI EIN and
add in its place USPPI Identification Number.
Rulemaking Requirements
Regulatory Flexibility Act
The Chief Counsel for Regulation of the Department of Commerce has
certified to the Chief Counsel for Advocacy, Small Business
Administration that this rule will not have a significant economic
impact on a substantial number of small entities. There were no
comments on this certification in the proposed rule.
In the current Foreign Trade Regulations, the Electronic Export
Information (EEI) shall be filed through the Automated Export System
(AES) for all exports of physical goods. The AES is the electronic
system for collecting Shipper's Export Declaration (SED) (or any
successor document) information from persons exporting goods from the
United States, Puerto Rico, Foreign Trade Zones located in the United
States and Puerto Rico, the U.S. Virgin Islands, between the U.S. and
Puerto Rico, and to the U.S. Virgin Islands from the United States or
Puerto Rico. Under this final rule, export shipments with ``21'' in the
DDTC USML Category Code field will be required to report the DDTC
Category XXI Determination Number.
In calendar year 2022, authorized agents and U.S. Principal Parties
in
[[Page 54236]]
Interest reported the DDTC USML Category Code of ``21'' on 0.6% of EEI
records. A large majority of the EEI records involved export shipments
of defense articles from branches of the Department of Defense. Based
on these statistics, the Census Bureau believes this rule will not
create any economic impact on companies including a substantial number
of small entities. As a result, a final regulatory flexibility analysis
is not required, and none has been prepared.
Executive Orders
This rule has been determined to not be significant for purposes of
Executive Order 12866. This rule does not contain policies with
federalism implications sufficient to warrant preparation of a
federalism assessment under Executive Order 13132.
Paperwork Reduction Act
Notwithstanding any other provisions of law, no person is required
to respond to, nor shall a person be subject to, a penalty for failure
to comply with a collection of information subject to the requirements
of the Paperwork Reduction Act (PRA) unless that collection of
information displays a valid Office of Management and Budget (OMB)
control number.
The information collection requirements included in this rule will
be submitted to OMB for review under OMB Control Number 0607-0152. The
information collection associated with that control number was approved
after 60-day and 30-day public comment periods (87 FR 70777; 88 FR
7680). This rule changes existing requirements for the information
collection but will not impact the current reporting-hour burden
approved under that control number. Public comment is sought regarding:
whether this proposed collection of information is necessary for the
proper performance of the functions of the agency, including whether
the information shall have practical utility; the accuracy of the
burden estimate; ways to enhance the quality, utility, and clarity of
the information to be collected; and ways to minimize the burden of the
collection of information, including through the use of automated
collection techniques or other forms of information technology. Submit
comments on these or any other aspects of the collection of information
to www.reginfo.gov/public/do/PRAMain. Find this collection under OMB
Control Number 0607-0152--AES Program.
Robert L. Santos, Director, Census Bureau, approved the publication
of this notification in the Federal Register.
List of Subjects in 15 CFR Part 30
Economic statistics, Exports, Foreign trade, Reporting and
recordkeeping requirements.
For the reasons set out in the preamble, the Census Bureau is
amending 15 CFR part 30 as follows:
PART 30--FOREIGN TRADE REGULATIONS
0
1. The authority citation for 15 CFR part 30 continues to read as
follows:
Authority: 5 U.S.C. 301; 13 U.S.C. 301-307; Reorganization plan
No. 5 of 1990 (3 CFR 1949-1953 Comp., p. 1004); Department of
Commerce Organization Order No. 35-2A, July 22, 1987, as amended,
and No. 35-2B, December 20, 1996, as amended; Public Law 107-228,
116 Stat. 1350.
0
2. Amend Sec. 30.2 by revising paragraph (d)(3) to read as follows:
Sec. 30.2 General requirements for filing Electronic Export
Information (EEI).
* * * * *
(d) * * *
(3) Electronic transmissions and intangible transfers.
* * * * *
0
3. Amend Sec. 30.3 by revising paragraphs (e)(1)(ii) to read as
follows:
Sec. 30.3 Electronic Export Information filer requirements, parties
to export transactions, and responsibilities of parties to export
transactions.
* * * * *
(e) * * *
(1) * * *
(ii) USPPI Identification Number.
* * * * *
0
4. Amend Sec. 30.6 by revising paragraphs (a)(1)(iii), (b)(3),
(b)(16)(ii) and (iii), and adding paragraph (b)(16)(ix) to read as
follows:
Sec. 30.6 Electronic Export Information data elements.
* * * * *
(a) * * *
(1) * * *
(iii) USPPI identification number. Report the Employer
Identification Number (EIN) of the USPPI. If the USPPI has only one
EIN, report that EIN. If the USPPI has more than one EIN, report the
EIN that the USPPI uses to report employee wages and withholdings, and
not the EIN used to report only company earnings or receipts. Use of
another company's EIN is prohibited. If a USPPI reports a DUNS, the EIN
is also required to be reported. If a foreign entity is in the United
States at the time goods are purchased or obtained for export, the
foreign entity is the USPPI. In such situations, when the foreign
entity does not have an EIN, the authorized agent shall report a border
crossing number, passport number, or any number assigned by CBP on
behalf of the foreign entity.
* * * * *
(b) * * *
(3) FTZ identifier. If goods are removed from a FTZ and not entered
for consumption, report the FTZ identifier. This is the unique 9-digit
alphanumeric identifier assigned by the Foreign Trade Zone Board that
identifies the FTZ, subzone or site from which goods are withdrawn for
export.
* * * * *
(16) * * *
(ii) DDTC Significant Military Equipment (SME) indicator. A term
used to designate articles on the USML (22 CFR part 121) for which
special export controls are warranted because of their capacity for
substantial military utility or capability. See sections 120.36 and
120.10(c) of the ITAR (22 CFR parts 120 through 130) for a definition
of SME and for items designated as SME articles, respectively.
(iii) DDTC eligible party certification indicator. Certification by
the U.S. exporter that the exporter is an eligible party to participate
in defense trade. See 22 CFR 120.16(c). This certification is required
only when an exemption is claimed.
* * * * *
(ix) DDTC Category XXI Determination Number. The unique number
issued by DDTC to a member of the regulated community (usually the
original equipment manufacturer) in conjunction with a notification
that a specific commodity is described in USML Category XXI. This
number is required only when citing USML Category XXI as an export
classification and is used to confirm that an authoritative USML
Category XXI determination is being referenced to do so.
* * * * *
Sec. 30.37 [Amended]
0
5. Amend Sec. 30.37 by removing and reserving paragraph (u).
0
6. Amend Sec. 30.55 by revising the introductory text to read as
follows:
Sec. 30.55 Confidential information, import entries, and withdrawals.
The contents of the statistical copies of import entries and
withdrawals on file with the Census Bureau are treated as confidential
and will not be released without authorization by CBP, in accordance
with 19 CFR part 103 relating to the copies on file in CBP offices. The
importer or import broker must provide the Census Bureau with
[[Page 54237]]
information or documentation necessary to verify the accuracy or
resolve problems regarding the reported import transaction.
* * * * *
0
7. Amend Sec. 30.71 by revising the note to paragraph (b) to read as
follows:
Sec. 30.71 False or fraudulent reporting on or misuse of the
Automated Export System.
* * * * *
Note 1 to paragraph (b): The civil monetary penalties are
adjusted for inflation annually based on The Federal Civil Penalties
Inflation Adjustment Act of 1990 (Pub. L. 101-410; 28 U.S.C. 2461),
as amended by the Debt Collection Improvement Act of 1996 (Pub. L.
104-134) and the Federal Civil Penalties Inflation Adjustment Act
Improvements Act of 2015 (Section 701 of Pub. L. 114-74). In
accordance with this Act, as amended, the penalties in title 13,
chapter 9, sections 304 and 305(b), United States Code are adjusted
and published each year in the Federal Register no later than
January 15th.
0
8. Amend Sec. 30.74 by revising paragraph (c)(5) to read as follows:
Sec. 30.74 Voluntary self-disclosure.
* * * * *
(c) * * *
(5) Where to make voluntary self-disclosures. The information
constituting a Voluntary Self-Disclosure or any other correspondence
pertaining to a Voluntary Self-Disclosure may be submitted to the U.S.
Census Bureau, Branch Chief, Trade Regulations Branch by methods
permitted by the Census Bureau. See www.census.gov/trade for more
details.
* * * * *
0
9. Amend appendix B by revising the entries for ``II. Postdeparture
Citation--USPPI'' and ``III. Postdeparture Citation-Agent'' to read as
follows
Appendix B to Part 30--AES Filing Citation, Exemption and Exclusion
Legend
* * * * *
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II. Postdeparture Citation--USPPI, AESPOST USPPI Identification
USPPI is filing the EEI. Number Date of Export (mm/dd/
yyyy).
Example: AESPOST 12345678912 01/
01/2017.
III. Postdeparture Citation--Agent, AESPOST USPPI Identification
Agent is filing the EEI. Number--Filer ID Date of
Export (mm/dd/yyyy).
Example: AESPOST 12345678912--
987654321 01/01/2017.
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* * * * *
Dated: August 3, 2023.
Shannon Wink,
Program Analyst, Policy Coordination Office, U.S. Census Bureau.
[FR Doc. 2023-16970 Filed 8-9-23; 8:45 am]
BILLING CODE 3510-07-P
